Myth 1. ROI is a finance concept and not an HR
concept.
Calculating ROI is based on a simple
mathematical formula. It takes into account benefits and costs. Enough tools
and methods are available to arrive at the benefits factor for all the
programs, processes and policies.
Myth 2. We do the evaluation. Post the program we
administer the reaction questionnaire/ feedback form.
Administering reaction
questionnaire is one part of the evaluation process. In fact, it is the base
level of an evaluation. Evaluation of any program or process takes a minimum of
three months to start showing the monetary benefits. A time period of at least
six months will give good results.
Myth 3. Soft
skills and behavior training cannot be measured.
Majority of the
things can be measured provided we intend to measure and we know how to
measure.
Three
things are vital
1.
Operational definition of the concept to be
measured
2. Measures
that are linked to the business needs
3.
Data availability
Various
tools, techniques, and software on measurements are available.
Myth 4. We
cannot measure everything.
Measurement is a
world of possibilities. Our entire world is governed by measurements. Some
measurements are available, some are derived.
Eg. Crossing
the road: We take the distance and make certain assumptions about the speed of
the car before we cross the road. Our brain is complex and is capable of
processing information at a speed with a multiplier effect. The brain processes
the information so fast that everything is governed at the subconscious level
and we act consciously. All the actions that we do are based on measurements
whether it is the force, speed or time.
Myth 5. ROI is
a measurement that can be done at the end of the training.
To find the ROI of any
program, we need to begin with the end in mind. Hence ROI process needs to be
included even before the program starts. That includes training needs analysis.
Myth 6.
Evaluation is time-consuming.
When one gets an ROI, one realizes that it is worth
spending the money and time in the evaluation process. It is better to invest
time in evaluation rather than repent on the amount, efforts and time spent on
programs that give no ROI.
Myth 7. No
matter what HR does, HR is never going to get the due.
Let us understand who gets the due? People who are
able to prove value and numbers get the due. Hence, sales professionals get the
due as bring in revenue. The irony is these people are recruited by HR. Still, HR
professionals do not get noticed. To get recognized HR needs to consciously
make decision around the below areas-
- Align the programs as per the business need.
- Need to shift the focus from reactive approach to proactive approach.
- Thoroughly understand the balance sheet and how decisions taken in HR can affect the balance sheet.
- Able to prove the ROI on every investment for training, employee engagement activities, introducing policies and processes.
- Develop competencies that are ahead of time. Example what competencies do HR need in this era of ‘Artificial Intelligence’ need to be thought of.
Myth 8. Our
CEO does not care for ROI on HR, training, and processes.
There
could be various reasons why there is not a mandate to prove the ROI on HR,
training, and processes. If the management has not mandated who stops an HR
from not proving the ROI for their initiatives. Once the HR starts showing the
numbers, the management would probably start noticing it.
Myth 9. We can
do evaluation process when the need arises.
Who
decides the need? You, your HR head or the CEO. It is all about mindset. To
develop a mindset of measurements and evaluation. A mindset to prove the
returns for every investment a company makes in HR.
Myth 10. To
calculate ROI, we need to have a strong mathematical ability.
To
calculate ROI on HR and training process, we do not need high-end knowledge of
mathematics or statistics. Basic knowledge is good. Though HR does need to
develop analytical skills. Knowledge of software such as SPSS or R would add
value.
